Japanese shares drop as tech losses eclipse gains in cyclicals

  • Reuters
  • Stock Market News
Japanese shares drop as tech losses eclipse gains in cyclicals
Credit: © Reuters.

TOKYO, March 19 (Reuters) - Japanese equities dropped on Friday as heavyweight technology stocks tracked steep overnight declines in U.S. peers after Treasury yields rose, but strong cyclical shares capped falls.

The Nikkei share average .N225 fell 0.79% to 29,979.35 by 0140 GMT, while the broader Topix .TOPX slipped 0.3% to 2002.52, ending an eight-day winning streak.

"Right now, the Japanese market could go any direction depending on the move of bond yields in the United States," said Norihiro Fujito, chief investment strategist at Mitsubishi UFJ Morgan Stanley (NYSE: MS ) Securities.

"It could take a long time for the U.S. bond market to be stabilized as we can expect more economic indicators that would signal a strong recovery."

Wall Street ended sharply lower on Thursday with the tech-focused Nasdaq tumbling 3%, hit by rising U.S. Treasury yields and fresh worries about the COVID-19 pandemic in Europe. .N

The yield on the benchmark 10-year Treasuries US10YT=RR crossed 1.75% to hit a 14-month high a day after the Fed projected the strongest growth in nearly 40 years. Japan, blue-chip technology shares fell, with SoftBank Group 9984.T dropping 2.1%, Tokyo Electron 8035.T losing 2.57%, Advantest 6857.T falling 2.04% and Fanuc 6954.T slipping 1.45%.

Sea transport and airline sectors advanced. Nippon Yusen 9101.T jumped 2.54%, Mitsui OSK Lines 9104.T rose 2.14% and Kawasaki Kisen 9107.T gained 1.29%.

ANA Holdings 9202.T rose 1.52% and Japan Airlines 9201.T gained 0.59%.

Japan's top three banks gained amid the rising interest rates, with Mizuho Financial 8411.T adding 1.69%, Sumitomo Mitsui Financial 8316.T jumping 1.76% and Mitsubishi UFJ Financial 8306.T gaining 0.76%.

The stocks that gained the most among the top 30 core Topix names were Honda Motor 7267.T , up 1.96%, followed by Mizuho Financial.

Nintendo Co 7974.T , down 2.40%, and SoftBank Group were the worst performers among the top 30 core Topix 30 names.

There were 108 advancers on the Nikkei index against 113 decliners.

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